What are Cryptokitties?
Check out this brand new trend in the cryptocurrency world – Cryptokitties.
Thanks to the Ethereum Blockchain it is now possible to buy and sell digital kittens.
Can you believe that?
Well listen to this….
Not only can you buy kittens, but once you start you can breed them to create new ones.
Each new cryptokitty will be totally unique, just like real mammals in the real world and which you can then also sell.
Each kitten or Cryptokitty has a series of visual characteristics called traits.
It is these traits that can then be passed on to their offspring some of which are less common than others.
Potentially if you have a Cryptokitty that can breed offspring that contain desirable traits and on a regular basis you have a potential digital money machine.
The more rarer specimens of Cryptokitty have risen massively in price.
For instance, a generation 0 Cryptokitten that possesses the Jaguar trait currently sells for around 70ETH ($23,676) and the price is expected to rise.
Last month a unique kitten called the Genesis Cat was sold for 246.9ETH ($117,000).
Where do Cryptokitties Come From?
Paying for digital goods is nothing new.
The difference with Cryptokitties is that the prices have gone from a little expensive to outrageous within just a few days.
Cryptokitties is a blockchain based game, build by San Francisco-based studio AxiomZen, a diverse team that includes numerous start-up founders, crypto-enthusiasts, and developers. AxiomZen recently won the world’s largest Ethereum hackathon at ETHWaterloo while featuring their alpha product.
In the same way that cryptocurrencies, such as Bitcoin, created on the blockchain are able to thrive, so Cryptokitties thrive.
Each of these Cryptokitties are unique and make up a new set of collectibles called cryptocollectibles.
The ownership of these cryptocollectibles or cryptokitties is tracked and logged on the Ethereum blockchain securely, thus safeguarding their ownership and protecting from fraud.
Unless you sell your kitten, you will own it forever, even if the game is shut down at a later date.
What You Need to Start Trading Cryptokitties
For those of you already measuring up the potential investment and trading opportunities of Cryptokitties here is what you need to get started:
- A computer or laptop running a desktop version of either Chrome or Firefox
- Ethereum’s digital wallet Metamask that is used specifically for web apps
- Ether, the digital currency on the Etheruem network that powers Cryptokitties
Once you have Metamask installed on your web browser you are ready to begin:
- Buy some Ether
- Transfer your Ether to your MetaMask wallet
- Begin trading Cryptokitties using your Ether tokens, transfer it to your MetaMask Wallet as shown below.
How to Play Cryptokitties
The best way to begin playing Cryptokitties is to start buying and selling kittens. You can then breed your kittens with others to create new and unique kittens.
Login to the Metamask and then visit the marketplace.
Here you will see the sale of kitties going on as shown in the image below.
Now you can fund you MetaMask wallet and actually begin purchasing kittens.
Purchase New Releases
The other option is to head over to the “Gen 0” area.
Here new Cryptokitties are released.
This will continue every 15 minutes up until November 2018 from when the system will be completely self-generating.
These can also be purchased with your Ether.
You may be interested in breeding a new offspring. This can be done can by heading over to the siring section and hiring a siring partner with which to breed your kitten with.
Now select which one of your CryptoKitties will be the Sire (or father) and which will be the mother.
- Go to “My Kitties”
- Select the Kitty who will act as Sire
- Press the breeding button
- Choose one of your other Kitties to be the mother
- Pay the Ether transaction fee of 0.3028ETH
You can expect a new Kitty to appear in “My Kitties” soon!
This brand new kitten can then be sold in the marketplace at your designated price.
How to Earn Money Trading Cryptokitties
Cryptokitties are not Cryptocurrecies.
They are more like Cryptocollectibles which can be collected and potentially will increase in value.
In that respect they are like stamps or works of art in the real world.
The value of a Cryptokitty can be increased by breeding to make a unique Cryptokitty which can be sold in the marketplace at a profit.
Alternatively you can buy a ‘Gen 0’ kitty and keep it for some time until the value of the kitty rises.
In this respect crypokitties are like cryptocurrencies.
And like any other product or collectible the marketplace is driven by demand and supply along with your asking price.
Will Cryptokitties Crash the Ethereum Network?
At present CryptoKitties is responsible for roughly 11.8% of all transactions on Ethereum’s network.
That’s greater than the decentralised token exchange Etherdelta, and the game has only been operating for a month.
Each action in the game, including buying and breeding cats, has to be recorded on the blockchain.
As more users purchase cats and begin breeding them the number of entries on the blockchain begins rising with a steep curve.
Due to the increased popularity of Cryptokitties there are around 10,000 pending transactions.
To alleviate this speed of transaction issue, CryptoKitties has doubled the “birthing fee” in an attempt to slow down growth.
Ethereum’s founder Vitalik Buterin has admitted on several occasions that something has to be done about how to scale up the blockchain when sudden rises in popularity occur.
Scalability has been an issue for digital currencies that utilise blockchain technology, such as Bitcoin. It has hampered growth as transaction processing speeds are still unable to compete with processors such as Visa or Stripe.
With the sudden huge increase in popularity of Cryptokitties, Etheruem need to act fast to increase transaction speeds or risk missing out in an attempt to preserve the network.
What is for certain is that Cryptokitties will be the first in a novel new line of cryptocollectibles which needs to be explored further and most definitely cannot be ignored.
Expect better performance and increased innovation in the future for blockchain technology. The ever increasing demand for cryptocollectibles will only fuel the innovations and lead to exponential increase in opportunities such as Cryptokitties.
As of the first week of December 2017 over $4M worth of Cryptokitties had been sold.